Mashreq, a Dubai-based financial institution, has recently concluded a one-year syndicated term loan facility for joint-stock commercial bank ‘Agrobank‘ worth $88 million.
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Mashreq took on multiple roles in this deal, acting as the sole coordinator, initial mandated lead arranger, bookrunner, and facility agent. This transaction holds significance as it marks the debut of a state-owned bank from Uzbekistan in the MENA region. Furthermore, the facility garnered substantial interest, with subscriptions exceeding the target by 75 percent. Also, the funds raised will be utilized for general corporate purposes.
Joel Van Dusen, Group head of Corporate & Investment Banking at Mashreq, expressed satisfaction with the partnership, stating, “The collaboration reinforces Mashreq’s commitment to fostering growth in emerging markets and supporting small businesses operating in vital sectors, such as agriculture.”
Expanding market reach
Originally launched with a target amount of $50 million, the facility eventually closed at $88 million due to positive market interest from investors in the Middle East, Europe, and the CIS region. This transaction is noteworthy as it expands Agrobank’s reach into markets beyond its traditional scope. Additionally, the facility enables Agrobank to diversify its funding sources and access new pools of liquidity. It follows various regional roadshows previously organized by Mashreq for Agrobank.
Uzbekistan’s Agrobank
Agrobank, one of Uzbekistan’s largest banks in terms of equity, is directly controlled by the government through the Ministry of Finance and the Uzbekistan Fund for Reconstruction and Development (UFRD). Moreover, the bank plays a crucial role in implementing the government’s initiative to provide affordable funding to farmers and agribusinesses. With a wide distribution network comprising 171 branches, 183 mini-banks, and 346 cash offices spread across the country, Agrobank serves 3.6 million clients, including small businesses, commercial and agricultural enterprises, farmers, family businesses, and individuals.
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